M&A volume within the Beauty Care industry remained depressed in Q3’22, down 7% from Q3’21. As anticipated, continued softness was driven primarily by increasing recession fears by both buyers and sellers, disrupted processes, and delayed market entries. Furthermore, brands dealt with increasing operating challenges including increasing customer acquisition costs for direct-to-consumer brands and a reduction in purchase orders as retailers curtailed inventory levels related to recession fears. Despite all the headwinds, Beauty Care M&A remained resilient with Q3’22 M&A levels up 4% from Q2’22, deal count at 25, and the announcement of multiple high profile transactions.
Deal volume in Q3’22 was led by strategic buyers including Amorepacific, Church & Dwight, L’Oréal, Shiseido, Puig, and Syoung Group. Private equity activity was led by active beauty care investors including Norwest Venture Partners, L Catterton, CAVU Consumer Partners, and Topspin Consumer Partners. From a category perspective, premium skin care transactions dominated the headlines with deals including Tata Harper, Hero Cosmetics, Skinbetter Science, Gallinée, Face Reality, Rescue MD, Evidens de Beauté, Nécessaire, and Under Your Skin.
The quarter also welcomed new acquirers in both the public and private markets. Waldencast became a public company, after completing its merger with Milk Makeup and Obagi, and Kim Kardashian launched new private equity firm SKKY Partners.
Finally, the Intrepid Beauty, Personal Care & Wellness Group remained active in Q3’22 having advised on two yet to be announced transactions that closed in July and August.
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Q3’22 Beauty Care M&A highlights include:
● Deal volume was up 4% from Q2’22 and down 7% from Q3’21.
● Strategic acquirers led the quarter with high-profile deals announced by Amorepacific, Church & Dwight, L’Oréal, Shiseido,
Puig (which completed two acquisitions during the quarter), and Syoung Group.
● Private equity activity was light but highlighted by key Beauty Care investors including Norwest Venture Partners,
L Catterton, CAVU Consumer Partners, and Topspin Consumer Partners.
● Milk Makeup and Obagi owner Waldencast became a public company.
● Premium skin care led the way with high profile brands such as Tata Harper, Hero Cosmetics, Skinbetter Science, Gallinée,
Face Reality, Rescue MD, Evidens de Beauté, Nécessaire, and Under Your Skin.
● Intrepid closed two yet to be announced beauty care deals in the quarter.